East Allegheny Approves Lease for Marcellus Shale Exploration, Drilling on District Land

Anne Cloonan
11/10/2014

The East Allegheny school board on Monday night voted unanimously to approve a lease agreement that will allow EQT Production Company to do Marcellus Shale drilling on district land.

District Solicitor Daniel Beisler said the company will work for six months to find possible drilling sites on district parcels. EQT representatives will look at 170.28 acres in fourteen different tracts to see if the school district owns the mineral rights under those properties, he said.

The closest potential drilling site to the high school/middle school campus would be on properties the district owns behind the middle school, at a minimum of 500 feet away from school buildings, Mr. Beisler said.

The company will give an upfront payment of $3,500 per net acre to the district, or $596,000, the solicitor said.

If the district doesn’t own the mineral rights under all the parcels, or is not the sole owner, the $596,000 payment will be smaller, he said.

Mr. Beisler said if the company starts drilling, the district will also receive 17 percent of the gross proceeds.

School Director Frederick Miller said if EQT actually drills and finds gas, the royalty payments could be used to pay long-term expenses such as teachers’ salaries and pension costs.

He said safety provisions are built into the lease.

Mr. Beisler said EQT representatives have been diligent at answering the district’s safety-related questions.

“Our interest is the safety of the residents,” he said.

The district is looking for ways to increase revenues and deal with a deficit that reached $1.158 million in 2013.

“If it is advantageous to the district, it’s worth exploring,” school board President Gerri McCullough said.